Environmental Valuation & Cost-Benefit News

Link: http://www.citylimits.org/images_pdfs/pdfs/UrbanGreen.pdf

Introduction
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The number of LEED projects registered each year in New York City has increased exponentially, but there is still a long way to go before LEED design becomes the construction standard. In New York City, nearly 5,000 permits for new construction projects were issued in 2007, but only around 200 of these projects registered for LEED certification. One explanation for the comparatively slow adoption of sustainable building practices in New York City is the perception that green building is expensive, but is this perception accurate?

The Urban Green Council ... recognized a ...research need. The
Council, with funding assistance by the New York State Research
and Development Authority (NYSERDA), engaged Davis Langdon to conduct a data-based study of the cost of building green in the City.
This report examines recent construction projects in New York City
in order to determine whether or not sustainability adds to project
costs, and, if so, how much.

Executive Summary

The Cost of Green in New York City found no significant difference in the cost per square foot between green and non-green buildings, based on analysis of luxury high-rise residential and commercial interiors projects.

In analyzing the data, the study also discovered that New York City LEED projects exhibit similar patterns of LEED credit achievement; certain credits are commonly achieved and others are rarely pursued.

Throughout 2008, data was gathered on 107 recent projects, of which 63 were either pursuing or had achieved LEED certification. These projects were evaluated and reviewed as a group; subsequently, construction costs for two subsets were analyzed statistically: highrise residences (38 projects) and office interiors (25 projects).

The study investigated a variety of construction measurements in order to obtain a full picture of green building practices in New York City. In the costs section of the report, statistical analysis was used to assess the impact on construction costs of building to LEED standards. In addition, soft costs associated with LEED were also examined.

In the characteristics of green section, the study looked at LEED credit achievement patterns in order to determine how LEED buildings in New York City differ from those built elsewhere. The final section uses case studies to provide a detailed look at the costs and benefits associated with building to LEED standards. This section also explores carbon modeling as a methodology to measure and compare projects’ environmental impacts.

Costs

In analyzing high-rise residential buildings, the study found that there is no statistically significant difference in construction cost between LEED and non-LEED projects. Visual examination of this data set indicates that projects with various levels of LEED certification are distributed throughout the range of costs with no apparent pattern.

The distribution of commercial interiors projects appeared to follow that of the residential buildings, but the pattern was not statistically clear. In addition, a visual examination of this data set suggests that the highest levels of LEED may have been achieved at a lower cost than other levels of LEED.

Soft costs associated with LEED certification were not substantial in terms of overall project cost. The median cost of LEED design fees was $0.56/sf, the median cost of LEED documentation was $0.30/sf, and the median commissioning cost was $1.55/sf. The range in LEED fees was considerable, with some projects, for example, adding nothing for LEED design fees and others adding as much as $6.62/sf.
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Of the 70 New Construction projects included in the study, 39 were pursuing or had achieved LEED certification, and 31 were not. These NC projects consist of high and low-rise residences, high and low-rise office buildings, libraries, academic buildings, and cultural institutions. All NC projects were included in the comparison of LEED credit achievement, but there were only enough data points to allow a statistical analysis of high-rise residential buildings. Of the 25 Commercial Interiors projects studied, 12 were pursuing LEED certification and 13 were not. The cost-related data collected for this study include project construction costs, LEED design fees, LEED additional fees, and commissioning fees.

For new construction and major renovation projects, costs ranged from under $200 per square foot to upwards of $1500 per square foot. The majority of projects, however, fell within the range of $300 to $600 per square foot. Costs for commercial interiors ranged from around $100 per square foot to over $400 per square foot, with the majority falling in the range of $100 to $200 per square foot. Building type and program are the primary cost drivers for most projects, dwarfing the cost implications of other factors such as sustainability. In order to isolate the cost impact of LEED, it was necessary therefore to compare like to like and segment the cost analysis by building and program type.

Construction costs for the bulk of high-rise residential projects fell within the $300 to $600 per square foot range. When separating the residential buildings into rentals and condominiums, rental buildings tended to fall at the lower end of the residential building cost range, between $200 and $400 per square foot, while condominium construction costs fall at the higher end, between $300 and $600 per square foot. Commercial Interior construction costs fell predominantly in the range of $100 to $200 per square foot.

The median percentage for design fees associated with LEED compliance was 0.14% of construction cost, which represents roughly 1% to 2% of a typical architectural fee. For LEED related fees, the median percentage was 0.08% of construction cost, and for commissioning fees, the median percentage was 0.27% of construction cost. Collectively these come to well under one half of one percent of construction cost for the average project.

Commissioning fees include the expenses incurred in hiring a Commissioning Agent and performing diagnostic checks of the building’s systems. For the New Construction projects surveyed, the median cost of design fees associated with LEED compliance was $0.56 per square foot, whereas the average cost was $1.47 per square foot. For LEED related fees, these values were a median of $0.30 per square foot and an average of $0.59 per square foot, and for commissioning fees, the median cost was $1.55 per square foot and the average was $2.35 per square foot.
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Case studies ... further illustrated the various methods by which LEED buildings can be analyzed in order to form a ... picture of the costs and benefits of building green.

Riverhouse is a high-rise residential project in Manhattan’s Battery Park City neighborhood. The Battery Park City Authority (BPCA) requires that its buildings, in addition to achieving a minimum of LEED Gold certification , also go beyond LEED requirements by including:
• photovoltaics
• blackwater treatment systems
• green roofs
• cogeneration power
• a central heating and cooling system which filters and humidifies the air
Riverhouse is expected to achieve LEED Gold certification by earning
41 points. Some of the significant sustainable features integral to Riverhouse’s design are the triple-glazing on the curtainwall (instead of the more common double glazing), the tracking photovoltaic panels, the blackwater and rainwater treatment systems, and the combined heat and power system.
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Many of the systems required by BPC for sustainability have begun paying for themselves, either directly through reduced operational costs or indirectly as selling points to tenants. Although installing a filtered central air system involved substantial up-front costs, the developer believes this system more than pays for itself by attracting and securing customers. The project is also anticipating considerable paybacks through energy cost savings. The central air system, tracking photovoltaics, triple-glazing on the curtainwall façade, extensive lighting sensors and efficiencies, and programmable thermostats have all contributed to a projected 19.9 percent savings in energy costs as compared to a base case design. As a result, the DOE-2 model indicates a $200,000 annual savings in energy costs. The blackwater system and other water conservation measures (50% total reduction in potable water consumption) are also anticipated to yield significant cost savings over time.

The Riverhouse team identified certain features as having been added solely as part of sustainable design goals that added significantly to construction costs. These include:
• central air system
• blackwater system
• photovoltaics
• triple-glazed curtainwall façade
• bamboo flooring
• programmable thermostats
• low-flow plumbing fixtures
Some of these features, however, are common to other luxury New York residences not pursing LEED, such as programmable thermostats and curtainwall facades (although double-glazing instead of triple-glazing is more often seen). Other features, such as low-flow plumbing fixtures and bamboo flooring, are comparable in cost to similar features typically used in high-end residential projects. This suggests that, at least when compared to similar luxury residential projects, those features could be viewed as part of the base costs rather than the green “additions.”
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In order to reduce the carbon footprint of its building materials, Riverhouse used recycled coal fly ash as a supplementary cementitious material (SCM) in its concrete. However, given that the concrete in Riverhouse accounts for only 12 percent of the project’s total material carbon emissions, the incorporation of fly ash does not have a large impact on the overall material carbon footprint. Nonetheless, the reduction in carbon emissions resulting from the use of recycled SCMs alone equates to removing about 24 cars from the road for one year.

Riverhouse employed certain design features such as tracking photovoltaics, a triple-glazed curtainwall, central air, and programmable thermostats in an effort to reduce the energy required to operate the building. Together, these measures reduce the operational CO emissions by 17 percent, which translates into removing approximately 164 cars from the road.
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All of the measures undertaken by Riverhouse’s design to reduce its carbon footprint should, when combined, prevent roughly 62,800 tons of carbon emissions from entering the atmosphere.

Urban Green Council www.urbangreencouncil.org
via City Limits www.CityLimits.org
Fall, 2009; Updated as of October 1, 2009